*Osama Suleiman from Vienna
Schlumberger International Oil Company confirmed that small oil companies in the maritime sector are witnessing a state of progress and continuous economic recovery. It noted that this sector-over the past three years-has seen a lack of investment caused by the decline in prices of crude oil.
It pointed out that this situation is going to go in the opposite direction in the coming years in order to meet the increasing global demand for crude oil.
A recent report by the International Company referred to Paal Kibsgaard, chief executive of Schlumberger, who confirmed that the exploration and production projects are moving to growth. They are recovering from a previous difficult recession despite the fact that exploratory spending is still lower than the industry's ambitions and keeping pace with market variables.
According to the international report, Kibsgaard said it is clear that the current level of exploration investments over the next three or four years is still volatile and unsustainable. It pointed out that the market started recording some rise in the second quarter, especially in terms of the number of exploration platforms, which rose 22 per cent and 7 per cent year-on-year basis.
The Schlumberger report predicted exploratory drilling this year at a level of about 12 per cent higher than in 2017, although no immediate and rapid financial flows were granted. It is expected to accelerate the growth of drilling activities in the next year 2019.
According to the report, there is another sign of increased interest in exploration and enhanced partnership with customers, which indicates a greater emphasis on identifying the best drilling systems, especially in the rock areas of the new offshore fields as well as in the land border areas.
In a related study, a report by Baker Hughes, a drilling company, quoted Lorenzo Simonelli, the company's chief executive, as he was saying that it expects to increase production orders from land and marine fields in 2019 with extensive improvements in offshore production systems, after several years of worsening recession, and the presence of a few global projects that have made good profits in recent years.
The Baker Hughes report said that because of the previous price weakness and the difficult economic cycle over three years, producers have directed most of their efforts towards promoting short-term, fast-paced investments such as shale oil, and the growth of new wells has been limited to existing companies and projects.
The report pointed to the CEO of Baker Hughes on the trend to revive more large oil projects, which had been approved in previous periods and was interrupted by market difficulties and low prices.
It pointed out that spending on foreign projects returned to more normal levels. Also, it is expected that these orders and new directions will begin to generate large revenues for oil companies by 2020.
"The experience of integrating Baker Hughes with GP Oil & Gas International in July 2017 was successful and represented an important development in the history of mergers of global energy companies," said Simonelli, "We are celebrating our first anniversary as a joint venture and we cherish this partnership and call for its replication to strengthen the market position, strengthen corporate positions and promote the industry in general."
He stressed the need for further integration of shallow water and deep-water projects. He pointed out that the market is looking to see more integrated projects in marine areas at different levels. He considered these regions still promising and can provide much and much for the future of the crude oil industry.
The international report praised the state of full and complete recovery in North America's narrow oil production in previous years, but then shrank over three years due to lower crude oil prices, which began to decline in the second half of 2014.
It pointed out that the state of recovery of production of oil in North America narrowed back to prosperity for about a year after the return of prices to rise.
The report pointed to the continued increase in oil supplies from North America because of the rapid pace of production well during the last year and a half, especially from non-traditional fields.
It added, "In contrast, international supplies continue to shrink and weaken because of the continued decline in production."
The report of the international company emphasized that after more than three years of the state of lack of oil investments, which the market suffered on a large scale, the global production base shows signs of accelerating on the case of weakness.
It deepened concerns about the supply of crude oil, especially in light of the significant decline in production compared to last year in more than 15 countries producing crude oil in the world.
The report pointed out that the current situation in the international crude oil market and industry confirms a compelling fact, which is that there is already an urgent and increasing need to increase spending and investment in upstream projects in the international markets over the next few years; urgent decisions cannot be postponed.
In addition, it pointed out that it is clear that even the new projects that will enter into force and production during the next few years will not be sufficient to meet the global demand for large and growing on oil and gas, according to officials of Baker Hughes and Schlumberger.
"Even in the United States, which has known for its abundant and rapid production and supply in recent years, the challenges and difficulties that were facing the production processes in oil shale in the current period. These difficulties are in part linked to the overlap of wells that may have been placed close to each other as a result of the increases in drilling activities."
It added that "the list of the difficulties of the US production is long and multiple, as it includes pipe bottlenecks and transport difficulties that arose due to the state of abundance of production and lack of suitability with the potential of infrastructure. In addition, the drilling activities in the privileged and cheap sites have already exhausted after achieving the highest production rates and the most intensive supplies, which is prompting investors to move to other, more expensive, less abundant supply areas, in terms of production intensity. This will have a wide impact on the weakening of the ability of the US production to continue at the same level of the former vast abundance."
On the other hand, with regard to prices at the end of last week, oil prices rose on Friday as the market gained support from the decline of the US dollar. Saudi Arabia's crude exports are expected to fall in August, which was overshadowing concern over US-China trade tensions and supply surges.
The US crude gained increases late in the session as the dollar index fell to a four-day low after reporting that the US President Donald Trump was worried that the Federal Reserve would raise interest rates twice in the second half of this year.
The US WTI futures contract ended the day at $ 70.46 a barrel, 1.44%, at $ 70.46 a barrel.
Global Brent crude futures rose 46 cents, 0.68 percent, to settle at $ 73.07 a barrel.
US crude ended the week down about 1 per cent, while Brent fell 3.1 per cent.
Moreover, the number of active oil drilling in the United States was recorded the biggest weekly drop since March as the rate of growth slowed over the past month amid recent declines in oil prices.
US crude prices hit a third consecutive weekly loss as trade tensions between the US and China surged, which was threatening to hurt the demand for oil.
"The oil drilling companies stopped operating five excavators in the week ending July 20," Baker Hughes Energy Services said on Friday in its closely monitored weekly report, "Which is bringing the total number of active oil rigs to 858." It is the first decline in three weeks.
But the number of active rigs, a first indicator of future production, remains much higher than a year ago at 764.
